Update May 2016…This blog originally spoke of “Negative royalties as what I call the cost that society bares in living in an industrialized airshed and all the ill-will health & property devaluation costs”. But as I updated this blog that the royalty payout was getting smaller, and once you factor in all the negative aspects of fracking, the checks indeed begin to seem so small…and figuratively NEGATIVE…Recently I ran across someone complaining of NEGATIVE LINE ITEMS on their royalty statements! So it is here that a claim has been made that someone has effectively PAID Chesapeake to take their gas…..wow

“As Skip states you can’t over produce into a system that has finite capacity. But there are other reasons for choking the well. One is you don’t want to damage the well or formation. If a high pressure well is allowed to over produce then the formation can be damaged. In the case of a fracked well then the proppant could be produced out of the well. Then there is nothing there but void space and the formation can collapse or be sucked into the wellbore.

The well on choke has sufficient pressure that it needs to be controlled. In the well with no choke the pressure is down to the point that running without a choke will not damage the formation or allow too much gas into the gathering system. And no an open choke in one well should not affect the other.

As Skip states as the wells decline its typical to increase the size of the choke.”

update.. this link shows some unhappy Chesapeake mineral owners of which one claims that here in the Barnett Shale that Chesapeake only paid .15 cents per mcf.

Roger, I should have sat closer to hear you better and I should have turned on my recorder sooner cause taking notes and listening is hard sometimes.

I need some clarification on some things you said.

The good news I heard you say is that all the pipelines R in and so there will be no more lag time in developing minerals. The bad news is that the price of NG is low. I understand that our royalties are half of what they were last year too.

I missed the part you said about if any drillers are shutting in the wells to wait for higher NG prices. Is Chesapeake doing this or one of the other drillers?

I also missed the part where you said the drillers were locked into some timeline where they need to drill so many wells within so many days? Can you restate that for me?

You also mentioned about “choking back” the well. Do you know which drillers are doing that?

Please provide specifics because I understand that Chesapeake may have some production quotas to maintain, and can be purposely overdeveloping the wells which could be shorting the city royalties by developing municipal minerals at the worst $$ possible time when NG is at a ten year low.

Why would Chesapeake NOT choke back the wells…you may ask? The answer could be that they need to make good on some Volumetric Production Payment contracts they have with the Chinese or with banks.

Deborah Rogers, Ft Worth economist, said “The court documents claim that Chesapeake has been overproducing wells in order to meet production targets for these banks. Overproducing shale wells is known to be potentially detrimental to the overall EUR’s (Estimated Ultimate Recovery) of the wells which raises the question as to whether this is prudent management with regard to mineral owners and their interests which Chesapeake has an obligation to uphold.” http://energypolicyforum.com/?p=345

The futures markets don’t expect NG to go to $6MCF before 2020 is what I’ve read. Also if the price of a barrel of crude stays above $70 then they can afford to frack for oil. Dry gas (what we have) can’t compete with oil because I did the math and figure that one MCF (thousand cubic feet) of natural gas has almost 6 times “less” the BTU’s of one barrel of crude oil.

We should be trying to prove if Chesapeake is being negligent in trying to frack in such as way (shorter frac stage segment lengths) so as to get a huge Initial Production Rate.

We need to be finding out which Arlington wells are tied to (off record?) VPP contracts that may be subject to production quotas….we might have legal grounds to ask Chesapeake to halt activity here until the price of NG goes up if they are being reckless in the timing or the way they are developing our minerals.

Keep an eye on the pressure dropping (and the production rates) on the White (monster well) drill site….it could go flat line at anytime and can be the victim of an intentional attempt to “drill to get a high IP rate” so that a positive sounding press release could be a misrepresentation of the majority of the other not so great? wells.

As usual, my most recent correspondences with Arlington government has been made public on my blog, so be sure to respond with that in mind, thanks.

PS Negative royalties is what I call the cost that society bares in living in an industrialized airshed and all the ill-will health & property devaluation costs.

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About Kim Triolo Feil

Since TX Statute 253.005 forbids drilling in heavily settled municipalities, I unsuccessfully ran for City Council Seat to try to enforce this. Since Urban Drilling, our drinking water has almost tripled for TTHM's. Before moving to Arlington in 1990, I lived in Norco’s “cancer alley”, a refinery town. It was only after Urban Drilling in Arlington did I start having health effects. After our drill site was established closest to my home, the chronic nosebleeds started. I know there are more canaries here in Arlington having reactions to our industrialized airshed (we have 55-60 padsites of gas wells). Come forward and report to me those having health issues especially if you live to the north/northwest of a drill site so I can map your health effects on this blog. My youtube account is KimFeilGood.
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10 steps to Safer Drilling

I live at ground zero for urban drilling.
We have about 60 padsites in our 99 sq mile town here in Arlington TX.

Our state and local governement will not enforce these two laws....
1) TEX LG. CODE ANN. A§ 253.005 : Texas Statutes – Section 253.005: LEASE OF OIL, GAS, OR MINERAL LAND
“(c) A well may not be drilled in the thickly settled part of the municipality..”

No person shall discharge from any source whatsoever one or more
air contaminants or combinations thereof, in such concentration and
of such duration as are or may tend to be injurious to or to adversely
affect human health or welfare, animal life, vegetation, or property, or
as to interfere with the normal use and enjoyment of animal life, vegetation, or property.
---------------------------------

We had a drill spill in Lake Arlington, our drinking source, a couple of years ago. We also have about 100 drilling laterals under our lake that are at migration risk for seismic events and or cement failures.

We have had maybe a dozen gas release emission events over the last few years that I am aware of.

The following are the items lacking in our URBAN oil and gas drilling ordinance….................

1. Use electric rigs & and use nondiesel compressors and fracking and lift compressors and compressor stations (but do not use field DIRTY GAS). Blowdowns of compressors whose excess goes to the storage tanks should have Vapor Recovery Systems rather than venting.

8. The setback away from people should be substantial. Rural method drilling is not acceptable in urban areas. An environmental tester who has a Phd said that the health effects are being seen downwind from about 1,800 – 2,500 feet. Local and state gov. need to test for methane leaks with FLIR cameras.

Lets elect officials that will ensure a protective Oil & Gas Drilling oversight. This is in our “collective” power so we must all become active to be proactive because reactive measures are too costly.